updated 02:40 pm EST, Wed December 19, 2007

Palm Fiscal Q207 Drop

Palm's profits have turned to sharp losses in the company's second fiscal quarter as it struggles to revitalize its smartphone business, the company announced today. Roughly falling in line with the company's already lowered expectations, the company's three-month period ending November 30th saw the company lose $9.6 million on sales of $349.6 million. Palm earned $12.8 million on a considerable higher sales number of $392.9 million in the same quarter a year ago, according to the report.

The company has already attributed at least some of the decline to delays in shipping an unknown device (now believed to be the Treo 755p for Verizon) but also said directly during its conference call for the results that the company's results were unacceptable and that restructuring was already underway to improve results in the future.

"We did not execute as well as we needed to," Colligan said during the call. "Fortunately, we have a team and investment group committed to making [a recovery] happen."

The statement refers in part to the staff shakeup triggered by former Apple executive Jon Rubinstein, who is believed to be coordinating hte firing of underperforming executives as well as reorganizing product development into an Apple-like system that focuses intently on individual projects and cancels side projects such as the Foleo companion.

Palm's misfortunes are generally credited to a steady drop in marketshare for its Centro and Treo phones, whose combined share been pushed further into single-digit percentages by Apple's iPhone and RIM's BlackBerry range. Palm is currently pinning its hopes on a new, Linux-based platform to replace the aging Palm OS as well as a significant reworking of its phone designs.